How tight is your inventory and why is having a smaller inventory extremely important?

Keeping your inventory tight is important for the sake of streamlining production and increasing buying power with vendors and reduced spoilage.

Saving Money On Orders

If your inventory is too spread out you are most likely purchasing small quantities of a larger spectrum of ingredients.

This will not give you the same kind of economies of scale with your purchasing than if you had fewer ingredients.

If your inventory is tighter then you will likely be purchasing a larger quantity of fewer items.

Many of the biggest food service businesses in the world, like Chipotle or Taco Bell, have one thing in common, and that’s a very tight inventory.

They don’t really have that many items for a reason because the leaner your inventory is, the easier you can scale your business.

 

Reduced spoilage

Another advantage of having a tight inventory is reduced spoilage.

Your wholesalers have minimums. If your inventory is too large then you may run the risk of not being able to use up all your produce before it starts losing its freshness and spoils.

If your juice bar sales don’t allow you to go through your minimum wholesale order, you will be forced to purchase smaller quantities at retail price, which is also not good for your bottom line.

Increased buying power with vendors

As mentioned above wholesalers have minimums but will also offer better prices if you are able to buy larger quantities. Keeping your inventory tighter helps your buying power with vendors as you can benefit from bulk order discounts.

So in summary, keep your inventory tight to help your buying power with vendors, scale your business easier and save on your bottom line!

 

If you feel you need help tightening up your inventory and would like to discuss this with us, reach out to us.